THE consultative committee (Con-com) created by the Duterte administration to revise the charter on Monday said it will vest power in the country’s regions to establish their own regional economic zones (ecozone) once the country shifts to a federal system under the proposed federal constitution.
Con-com Spokesman Conrado I. Generoso said in a news briefing that the committee will give this power to the federated regions to boost their capability to generate their own revenues.
“The regions have [will be vested with the power] to establish their own economic zones, but of course it does not stop the federal government from having its own economic zones,” Generoso said, adding that it would be better if the ecozone is established by the regional government to have rationalized economic zones “where all provinces may contribute.”
With this proposal, the Con-com envisions every province will grow with the establishment of regional ecozones, instead of having an ecozone in one province, while other provinces are left out.
The Philippine Economic Zone Authority in January also urged local government units to develop their own ecozones to empower and enrich them in time for the shift to federal form of government, noting that this will bring economic investments, provide job opportunities for residents and higher revenue generation among LGUs.
While conceding there might be differences in the speed of setting up regional ecozones, what is essential, Generoso said, is that the regions were given the power—and the option—to do so since setting up an ecozone is based on a particular regions’ capacity, competence and needs.
He added the regions may also seek financial assistance from the federal government, through the equalization fund to be administered by the Federal Inter-Government Commission (FIGC).
The Con-com is likewise proposing that the equalization fund be equivalent to 3 percent of the general appropriations of the federal government.
Under the Con-com proposal, the FIGC will administer an equalization fund to federated regions that may be in need of financial assistance in achieving economic viability and sustainability.
The 15-member body is also in charge of formulating programs and policies for grants-in-aid and fund transfers to address economic needs of the regions, ascertain the effectiveness and efficiency of the fiscal administration and management of the regional governments, assess the sufficiency of the regional governments in raising revenues, determine and reduce causes of financial imbalance, and promote friendly and cooperative relationship among regions through conciliation and mediation of disputes, and to provide for a system of equitable allocation of resources that will achieve the goals of the Federal Republic under the Constitution.
“[If there] is one region that doesn’t generate [enough] to be able to support an economic zone, then they can ask for financial assistance or grant from equalization fund to put up an economic zone,” Generoso said, noting that this may include assistance for putting up infrastructures within economic zones.
The Con-com cannot say yet, however, if the equalization fund will be administered on the longer term, but if the regions already have already achieved fiscal sufficiency, then the federal government may consider cutting off the aid.
Aside from putting up regional economic zones, the regional government will also be vested with exclusive powers within their regional territory over: socioeconomic development planning, creation sources of revenue, financial administration and management, tourism, investment and trade development, infrastructure, public utilities and public works, land use and housing, justice system, local government units, business permits and licenses, municipal waters, indigenous people’s rights and welfare, culture and language development, sports development, and parks and recreation.
The Con-com said it is already 100-percent done with its proposed constitution, and is on track to submitting it to the President on July 9 after the committee has subjected the draft to final review.
Its final en banc session is scheduled today (July 3), Con-com members are expected to vote on the adoption of the entire draft federal constitution.